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Would you tell your prices?

Discussion in 'Commercial Snow Removal' started by QuadPlower, Oct 22, 2007.

  1. QuadPlower

    QuadPlower PlowSite.com Addict
    Messages: 1,056

    Everyone is asking about prices. No one can give an accurate answer unless the people that are asking are from their town. Then, would you really tell them what you are getting?

    Here is my question: If GIE's SNOW magazine or Lawn & Landscape or any other magizine did a survey would it help? Would you give your rates?

    I think they could break it down by State atleast, and maybe even further by county. Make it look like a tempature weather map with the rates posted instead of the temps.

    Questions like truck plow rate, bobcat w/pusher or blower, insurances rates, worker pay rates, sub rates, sidewalk shoveler rates, salting rates, salt cost.

    Could Sean Adams set up a pole on this site were we could give our rates anonymous by location? Then if someone asks, they could go to it, look up their area, and get a price.

    Just a thought.
     
  2. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546

    Ok, so if there was a rate for the Palermo, Maine area; would that be anonymous? And, if we just put "Maine", it would be useless as rates vary significantly from southern to northern Maine. And I guarantee you that my rates are very different from Ole Tower, although we live only about ten miles from each other.
     
  3. forestfireguy

    forestfireguy PlowSite.com Addict
    Messages: 1,276

    Seems to me that knowing what the other guys are doing could lead to lowballing, however I'd prefer to think that if guy"1" is getting 100 an hour and guy "2" is only getting 60 the guy 2 sees a needs to raise prices and therefore sets the market higher for everyone. It's a sad fact that lowballers are out there, some people will spend 3 days out in the snow to break even, why I don't know.........but anyway if people realized that it's a micro economy and all of a given areas contractors really drive the market we'd all make alot more money. We deal a specialized, highly litigated service, with high standards of service, why should we all not be on the same page as far as pricing??????
     
  4. QuadPlower

    QuadPlower PlowSite.com Addict
    Messages: 1,056

    It could give the average for the town, if big enough, or the county. It would only be a starting point for people to base a bid on for something they have never bid before.

    No names, just prices for each thing. When someone asks for a price to plow something, they could be refered to that thread. Because really the only thing we can honestly give someone out of town or state is a time quote. "That parking lot would take 3.5 hrs and 1.5 tons of salt." as an example.
     
  5. JD Dave

    JD Dave PlowSite Fanatic
    Messages: 11,046

    I think we give enough information. I like helping guys out but alot of the guys just want everyone else to do the work for them. Proper bidding is done by trial and error and it soley depends on how much work I already have. I'm far from a one truck show now and I do not do anything for nothing anymore. When I first started, maybe I was a lowballer, but those prices got me the jobs that I still have now. Sometimes you have to be cheap to get the job and then once they know the job you'll do, you can increase the price. I'm with Mick, there is such a diff in price for each area, that it's not even funny and how honest is everbody really on price. I know some are honest but others are in fantasy land. A pole would be good for a very general reference for each area and I mean general. JMO
     
  6. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546

    Ok, let's be honest. You don't know how to price so you come here to ask how much would you charge for a driveway that is 75' long and 20 feet wide with a garage at the end so you'd have to backdrag. Some one from your area says I charge $50 for that. Then you say well, how much would you charge for a 1/2 mile private road that is gravel, staight and plenty of places to push off. That same someone says "$75". Would you then go to those homeowners and say I'll charge you $50 for that driveway and $75 for that road? Or would you say "Hell, I can do it for $45 and $70 to make sure I get it"? Besides, it only takes about $10 worth of gas, so I could charge $25 and $50. I'd still be making good money for 1/2 hour's work. So, now a $125 drive and road are going for $75. Remember, you asked how to price, so it's apparent you have no or little experience and not really thinking about all the costs involved.

    And that's my definition of a Lowballer - Some one who knowingly and deliberately uses another person's bid to come up with a lower bid.
     
  7. Brian Young

    Brian Young PlowSite Veteran
    Messages: 3,382

    Do you actually think they would be telling the truth?:blush2:
     
  8. Wayne Volz

    Wayne Volz Senior Member
    Messages: 694

    I think you guys are on target. I say know your cost, add margin and "push" the market price to see how much you can get. If you are selling at the same price as everyone else, you are cost selling.

    Sell at a price above "perceived market price" and you are VALUE SELLING. What will make you more money with less clients? It's not about how hard you work. This business accepts unreal risk. Make the risk worth the reward.
     
  9. SnoFarmer

    SnoFarmer PlowSite Fanatic
    from N,E. MN
    Messages: 8,592

    If we try to set prices it is "price fixing"
    And it is illegal.

    Every ones situation is different.
    Every job is different.

    Why do you need someone to tell you what to charge?
    What if it is not enough and you loose money?

    Bottom line is you can not relay on another business to set the prices you charge.

    Why do auto repair shops charge different amounts to do the same repair?
     
  10. QuadPlower

    QuadPlower PlowSite.com Addict
    Messages: 1,056

    Mick, I hope you were referring to the person in your example as being a Low Baller and not me. I have never ask for pricing help on a bid from this site. I know my costs and bid to get the job.

    There are regional prices for everything in the landscaping field published each year. You don't have to raise or lower your price because of it. No one publishes a plowing price (that I'm aware of). It doesn't matter what your field is (other than snow), but have you ever read how much someone is making doing your job and said either "I'm gettting the local average", or "I'm getting screwed lets ask for a raise, (or raise a price), or "I'm making out great."

    Lets say someone wants to start plowing drives. He figures he can bid a drive at $15 and make money. (used truck, insurance is already on his other business, drives are close to home, etc.) Finds a snow plow priceing list some where and sees that drives in his area are going for $25 - $30. He goes out and bids them at $25 and gets a couple. A couple of things happen. First off, he makes more money. The market stays high because he did not bid at $15 which helps everyone.

    You're always going to have people under bidding you. Either because their overhead is less and they can or because they low balled you just to get the bid.
     
  11. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546

    No, I wasn't referring to you, just giving my definition. However, I do disagree with a couple of points you made. You said something like "insurance is already on his other business". But unless his other business is snowplowing, only a portion of the insurance is on his other business. Rates are set by the industry, so half the rate may be whatever and half snowplowing. Now, let's take those examples and expand on them. Your snowplowing portion of insurance is, for example, $500 (1/2 a year premium). The other guy's premium is $1000, since it's his only business and all other factors influencing rates are equal. Already, he has to charge more just to break even. The other thing that I talk about a lot is the idea that someone can charge less because they have used truck that is paid for. In calculating my cost of business, I NEVER consider my current vehicle, whether paid for or making payments; I'm calculating anticipated repairs and replacement costs. For example, I bought a new 2500 and 8' plow last Fall. I'm not rolling in dough, so I'm making payments. But instead of thinking about how much I need to make each month to cover the payments, I'm figuring repairs (averaged over its expected lifetime) and replacement (cost divided by # of years expected to last). Now, I agree that you can't "overcharge the market" by very much, but if you have an idea of your costs, you will do a better job of setting realistic prices, rather than just going by someone saying "Oh that's a $50 driveway". Also, it will let you know when you're actually losing money by saying "I can do that $50 drive for $35"
     
    Last edited: Oct 23, 2007
  12. QuadPlower

    QuadPlower PlowSite.com Addict
    Messages: 1,056

    I'm in landscapeing and my snow plowing insurance is covered in the cost of my liability. I pay it no matter what. You can say that for 3-4 months it is for snow plowing and not landscaping, but I still pay the same yearly amount whither or not I do any business as a snow plower.

    You are right that I should be putting away replacement & maintenance cost of the vehicles. I use a 93 F250 and a 2005 Polaris to plow with. The replacement costs of a 93 F250 is $3000 and the replacement cost of the Polaris is $7000. Still below the cost of the 2500 and 8' plow you bought last fall.

    You have to know your costs, I agree. But with the above example, my costs are less, and there for I can charge less.

    Lets say I can go out and make a living doing 40 driveways at $15 a pop. But I know the area is willing to pay more for it. (read it in a post of the local cost for certian plowing jobs.) So I charge $30 and then I only have to do 20 drives and still make a living. Leaving the rest to other plow contractors so they can make a living.

    I agree that if you go by someone elses numbers you're a fool. But it is a starting point that I belive would help increase the market price. That's not "price fixing"

    On the other hand, lets say that you're thinking about getting into the plowing market and your cost has to be $50 per drive with 40 drives to make a living. You look at the going rate for your area and realize that it is only $25 per drive. You decide not to get into the plowing business. (Or reduce your costs some how)
     
    Last edited: Oct 23, 2007
  13. SnoFarmer

    SnoFarmer PlowSite Fanatic
    from N,E. MN
    Messages: 8,592

     
  14. snyps

    snyps Senior Member
    Messages: 101

    I just find it funny how much money low ballers leave on the table. I mean if you really want to go out and work for $5 an hour, go for it!! Personally I won't touch a driveway if it isn't worth my while. It will just take up valuable time for sleeping, and that is worth a lot more then $5 an hour to me..

    I lost a fairly big contract this year to a low baller, and she said to me "well I would like to keep your number in case this person falls of the face of the earth" I told her that a lower price might not be worth the headaches of having them show up late, or run away with your money.
     
  15. X-LOWBALLER

    X-LOWBALLER Senior Member
    from Toronto
    Messages: 102

    Just as my name states..........I realized very quickly how long a lowballer lasts (not too long). Many people will choose the lowballer then quickly realize that they get what they pay for. It took a few years but I now ONLY take the accounts that are willing to pay for EVERY minute of my service.


    One day, I met up with a guy who owns a sprinkler system company. He drives up and the lady who owns the home who was also my customer comes running out with her wallet and pays him prior to doing the work. He had worked for her for the past 2 or 3 seasons. I show up week after week and not once did she ever open her wallet unless I asked for the money atleast twice. One afternoon in front of her he asked what I charged to cut her property and I told him. In a loud voice he says "What?, are you freakin kidding me! You are seriously undercharging". He then schools me on a few things and it was his attitude that changed everything and everyway I do business now. I was soooooooo afraid to ask for money or raise rates for fear of losing customers when the whole time I wanted to be, and should have been just like him (the sprinkler guy).

    People will walk all over you and eat you up. The people out there doing biz to break even or to make a slight profit have no reason to be in business. They are better off collecting welfare. I realize that this doesnt have much to do with geographical pricing but the topic of lowballing came up and if people just stopped making excuses like "Trying to get my foot in the door" or "I don't have much overhead" we would make the money we deserve. Remember, we are out there checking weather every 2 or 3 hours, we keep their businesses open or allow people to get out of their house to go to work.

    It will take some time and thought but wouldn't you rather do 20 houses at $400 than 50 houses at $160?? (example only). In fact, this year we have 3 houses and the rest are commercial properties...I personally hate houses but since I jacked the price sky high, the 3 that took the offer made it worth our time.
     
    Last edited: Oct 23, 2007